J Mitra and Bros Vs ACIT (ITAT Delhi)
Material Facts
The assessee appealed against the order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre, dated 06.11.2023 for Assessment Year 2015-16. The assessee had filed its return of income on 30.09.2015 declaring NIL income. The case was selected for scrutiny through CASS, and a notice under Section 143(2) was issued by the ACIT, Circle 50(1), New Delhi. The assessment was completed under Section 143(3) by making an addition of ₹1,58,77,115 against the returned NIL income. The CIT(A) partly allowed the appeal by restricting the disallowance relating to advertisement expenses but sustained the remaining additions.
Procedural History
Before the Tribunal, the assessee challenged the jurisdiction of the Assessing Officer to issue the notice under Section 143(2), contending that the notice had been issued in violation of CBDT Instruction No. 1/2011. It was argued that, since the returned income was NIL, jurisdiction to issue the scrutiny notice vested in the Income Tax Officer and not the Assistant Commissioner of Income Tax.
Legal Issue
Whether the assessment under Section 143(3) was valid when the notice under Section 143(2) was issued by an Assessing Officer lacking pecuniary jurisdiction under CBDT Instruction No. 1/2011.
